Online advertising is a form of advertising where advertisers pay website operators or online content providers for placing online graphical or textual advertisements on the web pages. The markets for online advertising offer advertisers a broad range of payment options. For example, an advertiser may choose a cost-per-impression (CPM) option if the goal of the advertiser is to broadcast a message to the target audience. If the advertiser's goal is to lead the audience to a website or to take a predefined action, the advertiser may prefer a cost-per-click (CPC) or cost-per-conversion (CPA) option. The predefined action can be, e.g., making a purchase or subscribing an email list.
In order to efficiently estimate the cost of the advertisement campaign, a platform offering the CPC or CPA option needs to accurately determine the probability that the impression of the advertisement leads to a click or a conversion event. However, it is hard to predict whether a conversion will occur after an impression or a click event. While a click event often occur in a short time window after an impression of an advertisement, a conversion event can happen days or even week later. There is also a probability that a conversion event will never happen after the impression or the click event. These uncertainties make it difficult to predict the conversion probability in an accurate and efficient manner.